Editor’s note: A breaking-news alert linking to this story inaccurately referred to the August private-sector-payrolls rise as the smallest since March 2022. It was the smallest since this March.
The numbers: Private payrolls rose by 177,000 in August, down from a revised 371,000 in the prior month, according to the payroll services firm ADP on Wednesday.
Economists polled by the Wall Street Journal had forecast a gain of 200,000 private-sector jobs in August.
The July total of jobs added was revised from 324,000.
Key details: The slowdown in job growth was driven by the leisure and hospitality categories. Job creation in hotels and restaurants fell to 30,000 in August.
Service-producing jobs rose by 154,000. The goods sectors added 154,000 jobs.
Large firms added the most workers in August. Small firms only added 18,000 jobs.
Wages for people who stayed in their jobs rose 5.9% over the past 12 months, the slowest growth since October 2021. Pay growth for job changers decelerated to 9.5%.
Big picture: The softness of the report adds a sense that the economy is slowing a bit — something Federal Reserve officials would welcome.
The ADP data were much stronger over the past two months than the official government employment data.
Economists are expecting the Labor Department to report that 170,000 jobs were created in August.
What ADP said: “This is a pretty solid report,” said Nela Richardson, chief economist at ADP.
“After two years of exceptional gains tied to the recovery, we’re
moving toward more sustainable growth in pay and employment as the economic effects of the pandemic recede,” she added.
What they said: “Looking beyond the seasonal volatility, the trend in ADP data shows a labor market that is still growing moderately with only hints of cooling,” said economists at Contingent Macro.
Market reaction: Stocks DJIA SPX were set to open mixed on Wednesday. The yield on the 10-year Treasury note BX:TMUBMUSD10Y fell sharply to 4.12%.
